Intra-uterine growth retardation has been linked to the development of type 2 diabetes in later life. Mitochondrial changes have been suggested as a link between fetal malnutrition and adult insulin resistance. Taurine has been implicated in this process. We investigated whether protein malnutrition in early life alters mitochondria of the pancreatic islets in adulthood, and whether taurine supplementation restores these changes. Male offspring of rats fed a control diet, a low-protein diet or a low-protein diet supplemented with taurine during pregnancy and lactation were weaned onto the control diet. In each group, at 20 weeks of age, intravenous glucose tolerance tests, euglycaemic–hyperinsulinaemic clamp studies, morphometric analysis of the pancreatic islets and ultra-structural analysis of the mitochondria of the β-cells were performed. The expressions of cytochrome c oxidase (COX) I and mitochondrial respiratory chain complex II were also measured. Fetal protein-malnourished rats showed decreased pancreatic islet mass and reduced insulin-secretory responses to a glucose load. These rats also showed reduced mitochondrial DNA-encoded COX I gene expression in the islets. Electron microscopic examination showed abnormal mitochondrial shapes in the β-cells of fetal protein-malnourished rats. Taurine supplementation to the low-protein diet restored all these changes. Our findings indicate that a maternal protein-restriction diet causes long-lasting mitochondrial changes that may contribute to the development of type 2 diabetes later in life. The lack of taurine may be a key causative factor for these dysfunctional mitochondrial changes.